- The Swedish Supreme Administrative Court has ruled on the division of input VAT in mixed activities.
- The court stated that a taxable person cannot be denied the use of the turnover-based calculation method to determine the deductible input VAT in mixed activities.
- The Swedish Tax Agency’s position on the allocation of VAT partially contradicts the court’s ruling on mixed activities, and they will review their stance in light of the judgment.
- The court’s decision only applies to mixed activities within an economic operation, and other situations may require a division as well.
- The European Court of Justice has clarified that there are no provisions in the VAT Directive regarding the division between economic and non-economic activities, and member states have discretion in making such assessments.
- The Swedish Tax Agency will also review their position on other situations in relation to the division of VAT.
- The court’s ruling found that the Swedish implementation of the VAT Directive is inadequate and cannot be rectified by interpreting the provision on a reasonable basis.
- The court confirmed that Articles 173.1 and 174 of the VAT Directive have direct effect, allowing individuals to rely on these provisions to determine the deductible input VAT using the turnover-based method.
- The Swedish Tax Agency will review their position in light of the court’s ruling and may revise other statements as well.
- The court’s decision only applies to mixed activities within an economic operation, and other situations may require a division as well.
- The Swedish Tax Agency will also review their position on other situations in relation to the division of VAT.
- References to relevant laws and court cases are provided.
Source: www4.skatteverket.se
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
